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The Supreme Court and Lessons Learned

By Dr. David C. Pate, News and Community
April 9, 2012

I wanted to share my thoughts about the recent U.S. Supreme Court hearings on the 2010 health care law. For a refresher on the issues before the court, see my March 6 blog entry, “The Health Care Reform Law Challenge: Broccoli or Sour Grapes.”

Day 1: 

The question presented: the applicability of the Anti-Injunction Act.

This argument revolves around whether the penalty for not maintaining qualified medical insurance under the health care reform law is a tax and therefore, under the Anti-Injunction Act, it is premature to bring suit challenging the health care reform law until the tax is due and has been paid, which will not be until 2015 for tax year 2014.

The problem is that nowhere in the reform law did Congress refer to the penalty as a tax, and President Obama explicitly denied that it was a tax.

Lesson 1, to Congress and the President:  Political correctness can come back to bite you. Call a tax a tax.

For purposes of this legal challenge, it would have been politically more difficult to enact the health care reform law but very helpful if Congress and the President had called this a tax, for two reasons.

First, it would have made it much more likely that the justices would have entertained this penalty as being a tax and permitted the Anti-Injunction Act to apply, barring suit until 2015, even though there are some technical legal reasons why this still may not have worked.

Second, the Congress’ taxing powers under the Constitution are even broader than the Commerce powers. Therefore, the chances that the law would be held to be unconstitutional would have been lessened.

Observation from Day 1: It seems from the lines of questioning that both the conservative and liberal justices may align around the penalty not constituting a tax and this legal challenge not being barred by the Anti-Injunction Act.

Day 2: 

The question presented: the constitutionality of the individual mandate.

The question here was whether the requirement to purchase health insurance is a legitimate exercise of Congress’ Commerce powers. The Commerce powers arise from Article I of the Constitution, and provide that Congress may regulate interstate commerce.

The tough questions this day were what was the market – health care or health care insurance – and if it is health care insurance, can Congress compel someone into the market for the purposes of regulation.

Lesson 2: Don’t rush to judgment. The common wisdom was wrong.

Since the lawsuits were first filed, many Democrats, and perhaps the majority of legal scholars, have asserted that this would be a “slam dunk,” and the courts would have little difficulty in upholding the constitutionality of the law. Those of us who followed the oral arguments understand that this is not a “slam dunk” at all, and in fact, the law may very well be in trouble.

Lesson 3, to observers: Guessing how a justice will vote from a line of questioning is difficult and hazardous.

There are times when a justice just comes out and states his or her opinion during questioning. In those cases, you can be reasonably sure how that justice will end up voting.

But most justices are not so forthcoming, and it is not unheard of for a justice to change his or her opinion as the decision is being formulated and written. Some, such as Justice Clarence Thomas, are known for not asking any questions, while others are known for questioning the side they are leaning toward more severely in order to firm up their opinion. Chief Justice John Roberts had tough questions for both sides.

Despite the rush by many media and legal commentators to pronounce the individual mandate dead based on the second day of questioning, this is speculative and premature.

Lesson 4, to Congress: Tailor the remedy as narrowly as possible to the problem you are trying to solve.

It was clear that some of the justices were troubled that the solution to the problem the government articulated (that some of the uninsured are experiencing catastrophic health care problems on an emergency basis that they cannot pay for and thus these costs get passed along to all those with insurance) was addressed by requiring everyone to have health insurance that would meet the minimum benefit requirements.

These requirements included coverage for services that were not likely to be needed on an emergency basis and services that were not applicable to everyone (e.g., maternity and newborn care, pediatric services, and substance abuse treatment).

While we cannot know for sure, this law would likely have an easier time meeting the constitutional thresholds had those who were not insured been required only to purchase catastrophic health coverage.

Observation from Day 2: I previously predicted a 5-4 decision ruling the individual mandate unconstitutional.

After listening to the oral arguments, I believe that this may come out anywhere from a 5-4 ruling that it is unconstitutional to a 6-3 vote that it is upheld. Many, myself included, believe that Chief Justice Roberts and Justice Anthony Kennedy are the wildcards.

Day 3: 

The questions presented: If the individual mandate is unconstitutional, is it severable (meaning is just a portion of the health care reform act invalidated or is the entire law thrown out), and does the law’s requirement that states expand their Medicaid programs amount to coercion and therefore allow the court to overturn this requirement?

Lesson 5, to Congress: It would be helpful to put a severability or non-severability clause into your legislation, especially when you know there are going to be constitutional issues with the law and you are putting so many different things into it.

The court really struggled with the issue of what to do with the rest of the law if the individual mandate was determined to be unconstitutional. As Justice Antonin Scalia asked, “Can you take out the heart of the Act and leave everything else in place?” Justice Elena Kagan asked, “Is half a loaf better than no loaf?”

Lesson 6, to the lawyers: When you are asking the court to address a novel issue or to apply the law in a manner for which there is no direct precedent, be prepared to provide the court with a framework for making the decision that you can articulate under pressure and very succinctly.

The court understands that the three branches of government have different and limited powers. The court must establish the limits of these powers, especially when a power is being argued to be constititutionally or unconstitutionally applied in new and expanded ways.

I believe the attorneys would have strengthened their arguments by being able to articulate the new framework that they want the court to use in making its analysis as to whether an act of Congress is constitutional or not under that particular power.

Observation from Day 3: The matter of severability has huge implications to those of us in Idaho. Our Legislature decided not to enact enabling legislation to create a state-run health insurance exchange, counting on the law being ruled unconstitutional.

However, if the individual mandate is determined to be unconstitutional by the Supreme Court, but the court then decides that it is severable from the other portions of the law, this will leave the requirement for a health insurance exchange in place, and Idaho will be subject to a federally-run exchange.

Final thoughts:

I want to compliment all the attorneys that argued before the Supreme Court. The U.S. Solicitor General received a lot of criticism that I think was largely undeserved. It is incredible pressure to appear before the Supreme Court to argue a case under any circumstances, let alone when arguing a case of critical importance to the country, with the country listening in, and with constant interruptions as justices rapid-fire questions at you.

Our state was a party to this case in challenging the law, and I want to especially commend Paul Clement, who represented the 26 states. I thought that we did not have a prayer of prevailing on the coercion claim related to the expansion of the Medicaid program. Mr. Clement not only persuaded me, he may also have persuaded a number of the justices.

We expect the decision to be handed down at the end of June.

About The Author

David C. Pate, M.D., J.D., is president and CEO of St. Luke's Health System, based in Boise, Idaho. Dr. Pate joined the System in 2009. He received his medical degree from Baylor College of Medicine in Houston and his law degree from the University of Houston Law Center.